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PFQF PRACTICE EXAM 2 QUESTIONS WITH COMPLETE SOLUTIONS.
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PFQF PRACTICE EXAM 2 QUESTIONS WITH COMPLETE SOLUTIONS.
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Name: Score:74 Multiple choice questions
Term 1 of 74
Which of these is accomplished by a living will?
It authorizes another person to make health care decisions for the writer on their behalf.
It distributes the assets of the writer upon their death.
It states in advance what medical measures may be employed if the writer becomes
incapable of consenting to treatment.
It distributes the assets of the writer during their life.
Term 2 of 74
Which one of the following items is found on the financial statement in which net worth is
calculated?
Cash and cash equivalents
Purchase price of use assets
Projected expenses
Income from all sources
Term 3 of 74
Which one of the following statements regarding the Affordable Care Act (ACA) is NOT correct?
One major goal of the ACA is to have as many individuals paying insurance premiums as
possible.
Preexisting conditions are covered under ACA plans.
Some policies may have a $1 million lifetime limit.
There is a special plan available for individuals under age 30 who do not want the same
amount of coverage as other plans offer.
,Term 4 of 74
For mortgage lending purposes, which one of the following financial statement amounts and
financial planning ratios is typically used?
Gross income in the basic liquidity ratio
Net income in the debt-to-income ratio
Net income in the basic liquidity ratio
Gross income in the debt-to-income ratio
Term 5 of 74
Which one of the following best describes the concept of indemnity as it applies to insurance?
After suffering a loss, the insured is made whole.
The concept of indemnity does not apply to insurance.
An at-fault insured cannot collect from a home insurance policy.
If a loss was not the fault of the insured, she can collect more than the loss amount from an
insurance policy.
Term 6 of 74
Which one of the following is the best description of itemized deductions?
Trade or business expenses deductible from adjusted gross income (AGI)
Personal expenses deductible from adjusted gross income (AGI)
Trade or business expenses deductible in arriving at gross income
Personal expenses deductible in arriving at gross income
, Term 7 of 74
Ron is taking out a $100,000, 30-year, fixed-rate mortgage. If his interest rate is 6%, compounded
monthly, and payments are due at the end of each month, what is the amount of his interest and
principal payment?
$605.41
$596.57
$588.44
$599.55
Term 8 of 74
Which of the following statements regarding the federal estate tax are CORRECT?
I. Estate taxes are levied by the federal government on assets included in a decedent's gross
estate.
II. Each heir of an estate must pay estate taxes.
III. Estate taxes are paid by a decedent's estate.
IV. Some states also assess an estate tax on the assets of a decedent
II, III, and IV
I, III, and IV
III and IV
I and II
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